Reporters Notebook

Procter & Gamble’s Olay has named singer-songwriter Carrie Underwood as its first-ever North American celebrity brand ambassador, joining well-known Olay brand ambassadors from around the world.

Inspiring a new generation of women, Underwood will take part in the brand’s “Challenge What’s Possible” campaign, scheduled to debut later this year. She also will represent a line of skin care products for the brand.

Coty has signed German supermodel and TV presenter Heidi Klum as the new face of and artistic adviser for the global beauty brand Astor. The first-of-its-kind creative collaboration allows the Astor brand to integrate Klum’s fashion-forward point of view into the brand collections, and capitalize on the style trends, as part of the company’s mission to introduce the brand to a new audience and speak to consumers in a new way. Astor is distributed in perfumery chains, department stores, drug stores and mass merchandisers in many European markets.

Executive News

Ethnic personal care company Dr. Miracle’s has appointed former Reynolds Consumer Products executive Randy Zeno as its new CEO. While at Reynolds Consumer Products, Zeno served as interim president as the business transitioned from Alcoa to its new owner, the Rank Group. In addition, he brings leadership experience in the consumer products industry with such companies as Nabisco, Sara Lee, Cadbury Schweppes, International Home Foods and Birds Eye.

Revlon has hired Julia Goldin as SVP and global chief marketing officer, overseeing all marketing activities for its portfolio of brands. Goldin, who has more than 20 years of experience within the consumer packaged goods industry, most recently served as SVP and deputy chief marketing officer of Coca-Cola Japan, where she oversaw the company’s coffee business.

CVS’ future rests on front-end, private-label evolution

NEW YORK CVS Caremark has no doubt been a trailblazer in the healthcare arena, positioning itself along the front lines to leverage its various points of care to improve outcomes and lower healthcare costs. But with all that CVS Caremark has done and will continue to do in the healthcare space — and it is no doubt a lot — it still has more than 7,000 retail locations, and the front of the store continues to be a critical part of its business and a major growth driver for the company.

(THE NEWS: At his last analyst day, Ryan sets out course for future CVS Caremark. For the full story, click here)

The front end is an $18 billion business for CVS and to be sure the company continues to look for ways to drive even more productivity out of its stores. It comes as no surprise that one area it will target for additional growth is private label. Private-label penetration currently stands at 17%, and over the next two to three years, company executives expect that number to grow to more than 20%.

"Private-label brands continue to grow and evolve. In this economy, consumers have shown that they are much more willing to try private-label products," Mike Bloom, EVP merchandising and supply chain, told analysts during Friday’s 2010 analyst meeting in New York. He noted that by the end of 2010, CVS/pharmacy will have nearly 5,100 private-label items storewide, which is an increase of 900 items versus last year. Each year, the company adds about 900 new private-label items and leverages ExtraCare to encourage trials among cardholders.

What is news, particularly to suppliers, is that a key component of CVS’ private-label program is an entirely new line that the company plans to introduce in February 2011, called Just The Basics — named to clearly communicate its functional, value-priced, smart, simplicity positioning. What is significant is that the new line is not a national-brand-equivalent type execution, but rather, more of a basic entry-point, low-price alternative.

"Now, while many retailers are stuck in the brand-follower mode of the 1980s, we have evolved to a leadership role," Bloom said.

The company also is increasingly turning to "treasure hunt" items and is using its circulars to drive front-end sales. For example, it recently promoted a WiFi-capable Netbook for $99.99 on the front page of its circular. While a Netbook isn’t your traditional drug store product offering, it has proven to be a hit among shoppers. CVS sold $3 million worth of Netbooks in three weeks, and it will be a $15 million item at CVS, the company said.

Then there’s beauty. As the article states, CVS is piloting a mini format of its Healthy Skincare Centers (in 120 stores) and will launch in January an ExtraCare Beauty Club.

Clearly the front end continues to be a significant growth driver for CVS and that will continue to be the case for a long time to come.

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